Brompton Split Banc Corp. Announces Successful Overnight Offering
April 12 2023 - 3:06PM
(TSX: SBC, SBC.PR.A) Brompton Split Banc Corp.
(the “Company”) is pleased to announce a successful overnight
treasury offering of class A shares and preferred shares (the
“Class A Shares” and “Preferred Shares”, respectively). Gross
proceeds of the offering are expected to be approximately $30
million. The offering is expected to close on or about April 19,
2023 and is subject to certain closing conditions. The Company has
granted the Agents (as defined below) an over-allotment option,
exercisable for 30 days following the closing date of the offering,
to purchase additional Preferred Shares and Class A Shares up to
such number as is equal to 15% of the number of Class A Shares
issued at the closing of the offering.
The Class A Shares were offered at a price of
$10.80 per Class A Share for a distribution rate of 11.1% on the
issue price, and the Preferred Shares were offered at a price of
$9.85 per Preferred Share for a yield to maturity of 6.7%.(1) The
Class A Share and Preferred Share offering prices were determined
so as to be non-dilutive to the most recently calculated net asset
value per unit of the Company (“Unit”) (calculated as at April 6,
2023), as adjusted for dividends and certain expenses to be accrued
prior to or upon settlement of the offering.
The syndicate of agents for the offering was led
by RBC Capital Markets, CIBC Capital Markets, National Bank
Financial Inc., and Scotiabank and included Hampton Securities
Limited, Canaccord Genuity Corp., BMO Capital Markets, Raymond
James Ltd., TD Securities Inc., iA Private Wealth Inc., Echelon
Wealth Partners Inc., Manulife Securities Incorporated, Research
Capital Corporation and Richardson Wealth Limited.
The Company invests in a portfolio (the
“Portfolio”) consisting of common shares of the six largest
Canadian banks: Royal Bank of Canada, The Bank of Nova Scotia,
National Bank of Canada, The Toronto-Dominion Bank, Canadian
Imperial Bank of Commerce and Bank of Montreal. In addition, the
Company may hold up to 10% of the total assets of the Portfolio in
investments in global financial companies for the purpose of
enhanced diversification and return potential.
About Brompton Funds
Founded in 2000, Brompton is an experienced
investment fund manager with income focused investment solutions
including exchange-traded funds (ETFs) and other TSX traded
investment funds. For further information, please contact your
investment advisor, call Brompton’s investor relations line at
416-642-6000 (toll-free at 1-866-642-6001), email
info@bromptongroup.com or visit our website at
www.bromptongroup.com.
(1) See Performance table
below. No cash distributions will be paid on the Class A Shares if,
after the payment of a cash distribution by the Company, the net
asset value per Unit (consisting of 1 Class A Share and 1 Preferred
Share) would be less than $15.00. Yield to maturity for the
Preferred Share is based on maturity date of November 29, 2027.
A short form base shelf prospectus
containing important detailed information about the securities
being offered has been filed with securities commissions or similar
authorities in each of the provinces and territories of Canada.
Copies of the short form base shelf prospectus may be obtained from
a member of the syndicate. The Company intends to file a supplement
to the short form base shelf prospectus, and investors should read
the short form base shelf prospectus and the prospectus supplement
before making an investment decision. There will not be any sale or
any acceptance of an offer to buy the securities being offered
until the prospectus supplement has been filed with the securities
commissions or similar authorities in each of the provinces and
territories of Canada.
You will usually pay brokerage fees to your
dealer if you purchase or sell shares of the Company on the Toronto
Stock Exchange or other alternative Canadian trading system (an
“exchange”). If the shares are purchased or sold on an exchange,
investors may pay more than the current net asset value when buying
shares of the Company and may receive less than the current net
asset value when selling them.
There are ongoing fees and expenses associated
with owning shares of an investment fund. An investment fund must
prepare disclosure documents that contain key information about the
fund. You can find more detailed information about the Company in
its public filings available at www.sedar.com. The indicated rates
of return are the historical annual compounded total returns
including changes in share value and reinvestment of all
distributions and do not take into account certain fees such as
redemption costs or income taxes payable by any securityholder that
would have reduced returns. Investment funds are not guaranteed,
their values change frequently and past performance may not be
repeated.
Brompton Split Banc Corp. Compound Annual NAV
Returns to March 31, 2023 |
1-Yr |
3-Yr |
5-Yr |
10-Yr |
S.I. |
Class A Shares (TSX: SBC) |
(27.0%) |
29.5% |
6.4% |
12.3% |
10.1% |
Brompton Split Banc Corp. – Unit |
(12.7%) |
16.5% |
5.9% |
9.3% |
8.0% |
S&P/TSX Composite
Index |
(5.1%) |
18.1% |
8.8% |
7.9% |
6.8% |
Preferred Shares (TSX: SBC.PR.A) |
5.5% |
5.2% |
5.2% |
4.9% |
5.1% |
Returns are for the periods ended March 31, 2023
and are unaudited. Inception date November 15, 2005. The table
shows the Company’s compound return on a Class A Share, Preferred
Share and Unit for each period indicated. The table shows the
Company’s compound return on a Class A Share, Preferred Share and
Unit for each period indicated and the S&P/TSX Composite Index
(“Index”). The Index tracks the performance, on a market weight
basis, of a broad index of large-capitalization issuers listed on
the TSX. The performance of the Company is not expected to mirror
the performance of the Index which has a more diversified
portfolio. The Index is calculated without the deduction of
management fees, fund expenses and trading commissions, whereas the
performance of the Company is calculated after deducting such fees
and expenses. Further, the performance of the Class A Shares is
impacted by the leverage provided by the Preferred Shares.
Certain statements contained in this document
constitute forward-looking information within the meaning of
Canadian securities laws. Forward-looking information may relate to
matters disclosed in this document and to other matters identified
in public filings relating to the Company, to the future outlook of
the Company and anticipated events or results and may include
statements regarding the future financial performance of the
Company. In some cases, forward-looking information can be
identified by terms such as “may”, “will”, “should”, “expect”,
“plan”, “anticipate”, “believe”, “intend”, “estimate”, “predict”,
“potential”, “continue” or other similar expressions concerning
matters that are not historical facts. Actual results may vary from
such forward-looking information. Investors should not place undue
reliance on forward-looking statements. These forward-looking
statements are made as of the date hereof and we assume no
obligation to update or revise them to reflect new events or
circumstances.
The securities offered have not been registered
under the U.S. Securities Act of 1933, as amended, and may not be
offered or sold in the United States absent registration or any
applicable exemption from the registration requirements. This news
release does not constitute an offer to sell or the solicitation of
an offer to buy securities nor will there be any sale of such
securities in any state in which such offer, solicitation or sale
would be unlawful.
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